Viacom sees disappointing results for Q1


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Michelle Clancy

| 11 February 2016




Viacom has reported a decline in ad sales, leading to poor earnings for Q1, logging $3.2 million in revenue.



The results were a bit ugly: profit plunged 10% and revenue fell 6% to $3.15 billion. Media networks revenues declined 3% to $2.57 billion. Worldwide advertising revenues decreased 3%, reflecting an unfavourable 1% impact of foreign exchange. International advertising revenues declined 2%, and international affiliate revenues decreased 6%, driven by a 9% unfavourable impact of foreign exchange. But, absent the impact of foreign exchange, international affiliate revenues increased 3%.

But, "As the media industry continues to evolve quickly, Viacom is generating sustainable opportunities using great new content, innovative technology, marketing and data applications, along with the benefits of our substantial footprint in key international growth markets,” said Philippe Dauman, executive chairman, president and CEO of Viacom. “Our investments in new content have led to higher ratings at most of our networks, including VH1, Spike, BET, TV Land, CMT and Nick at Nite, as well as Nickelodeon, which recaptured its lead as the top network for kids 2 to 11.”

He added that Viacom saw “significant” sequential improvement in domestic advertising sales, due to the success of new programming and advertising products.

"2015 was a challenging year operationally as we redesigned ourselves and adapted to significant industry disruption,” said Dauman. “Our first fiscal quarter of 2016 reflected these challenges. However, our revitalised organisation and our investments in content, technology and strategic innovation are now beginning to bear fruit. Although our industry continues to face headwinds, we expect our positive momentum to continue and build throughout the year."

Filmed entertainment revenues decreased by 15% to $612 million, as an increase in licence fees was more than offset by declines in theatrical and home entertainment revenues. Excluding foreign exchange, which had a 3% unfavourable impact, worldwide revenues declined 12%. Worldwide theatrical revenues decreased $75 million in the quarter, as carry-over revenues decreased $46 million, principally due to an unfavourable comparison with the strong performance of Teenage Mutant Ninja Turtles in the first fiscal quarter of 2015.